This paper considers the sensitivity of policy simulation to the specification of the labour market in an Applied General Equilibrium (AGE) model of the European Union. We consider a variety of adjustments to the labour market, including the introduction of labour supply heterogeneity and...

There is little doubt that the step towards a monetary union in Europe will increase both the distortionary effects of existing differences in national tax systems and the intensity of tax competition for internationally mobile commodity and factor tax bases. This paper discusses selected issues...